The Rabid Independent, Nonpartisan solutions, independent policy ideas

All budget busters are welcome

Two years ago it seemed extreme when Bernie Sanders proposed free state college tuition for everyone. He guessed it would cost $75bn and most people wrote it off as the loose talk of a socialist. It was just Bernie being Bernie.

Last year the Repubs passed a corporate tax cut that has created $1trn budget deficits as far as the eye can see and that assumes solid growth. If we get any weakness in GDP (tax revenue) then this will really get interesting. No one seems to pay attention to these figures and they talk as though the better growth figures came out of the blue. There is no cost. Apparently budget deficits have fallen completely off the radar. Bernie’s tuition plan suddenlt seems cheap.

The new trove of Democratic Presidential candidates has taken note. Many now support Medicare for all and some have endorsed the “Green New Deal”. Everyone supports free community college and most accept free state college as a given. This has led to the accusation that the Democratic party has lurched to the left (which isn’t the same as becoming socialists). They have and so have the budget busting Republicans.

Somehow we reached a point where providing free services to the people is leftist or socialist whereas cutting corporate taxes is noble or at least a beautiful free market gesture. Please let’s eliminate the word socialist from the conversation – they believe that the government should own certain industries or at least companies in key industries – like a national phone or oil company. So far I haven’t heard any Democrat advocating for a government takeover of any industry. Bernie wants to offer cheaper or free services to the middle class; Elizabeth Warren wants to increase government oversight.

It is now true to say that the Republican tax cuts have pushed the Dems away from fiscal rectitude. So-called moderates look for ways to pay for some of these goodies which makes their pitch decidedly less attractive than a Republican platform with no budget concerns at all. Progressives have no qualms about budget deficits since Paul Krugman told them not to worry. How can moderates win?

We have entered a race to outspend or out-cut taxes. Keynes is rolling over in his grave. What’s the difference between $1trn and $1.5trn? Will millenials ever wake up to the fact that the bill is coming to them? Alexandria Ocasio-Cortez is a millennial but no one seems to have ever explained government finance to her.

Someone should set up a meeting between Alexandria and David Stockman.

How Can Independents Help?

The former CEO of Starbucks is considering a Presidential run as an independent. Both major parties are paranoid about losing critical electoral college votes to an independent. First, let’s understand why he doesn’t think either party suits him. He hates Donald Trump so the Republican party is not an option. But what about running as a Democrat? He says:

“When I hear people espousing free government-paid college, free government-paid health care and a free government job for everyone — on top of a $21 trillion debt — the question is, how are we paying for all this and not bankrupting the country?”

These are straw men chosen to suit his preference, which is to be free of multi-candidate primaries. Apparently, all his views on social issues fit into the Democrat category so if he takes votes from anyone, they will be Democratic. The Dems are angry.

If he runs and wins a healthy 15% of the vote he will likely swing the election to a candidate that earns far less than a plurality. How could he contribute favorably to the outcome? On the day of each convention when they count the delegates it’s too late. What if on the week before the chosen party’s convention Schulz could make an appearance and bring with him his own delegates (proxies). He would then provide a huge boost to “his” candidate of choice for that party. He would step back into the darkness having influenced the election by virtue of pulling candidates toward his stated views. During the debates and the barnstorming, candidates will be aware that skewing their positions towards Shultz could yield a great big fat bonus at the end. At that time he would officially drop out of the race.

No one could accuse him of being a spoiler and he would make an imprint on a party which has representation in Congress. If he has received a huge chunk of the vote then he could also simply join that party right near the end and work to get the additional needed votes/delegates during the convention.

Either way, if he chooses one of the two major parties so they get the best candidate (in his opinion),then he won’t be a spoiler in the national election. This will take a dose of realism on his part. He must see that 25% or less of the electoral vote won’t become 40% in a three-way race just because the parties’ conventions are over. If Trump holds onto his 35% core and Bernie holds his 35% then Shultz will need to steal and grab some of both to get him across the line.

Ross Perot grabbed 19% of the vote in 1996, a great result for an independent with a squeaky voice, nowhere near enough to be a threat to Clinton but enough to hurt Dole (and Bush in 1992). So what did Perot achieve?

Absolutely nothing.

Why are we arguing?

I am a little confused by the obstinacy of the Democrats. Yes, a wall is a little old school. It’s too expensive and does nothing to stop permanent tourists – our real source of illegal immigration.  Is it the expense that so bothers everyone – the paltry $5.7bn Trump is asking for? Or is it simply the fact that Trump is the guy asking? My guess is that a majority of Americans are OK with the money, so why shut down the government over this? This is their litmus test for open-mindedness and Dems are determined to pass.

Has everyone been following the deeds and achievements of our troops in Syria? Are we actively fighting and killing ISIS militias? Where are our reporters on the ground filming all this? Perhaps I’m not watching the right nightly news. If Mattis had great victories to report wouldn’t we have heard about them? I don’t know anyone who is broken up about reducing our (invisible) army force by half. Americans don’t care about these kinds of Middle Eastern civil wars. Besides, Russia and Assad are both also fighting and killing ISIS too, right? Let them handle this.

How did Mattis’s resignation help (the Dems)? He was the cool general that everyone agreed was thoughtful and a good influence on Trump. In the end, he just looks like any standard issue war-loving military idiot. Why should I be on his side?

Then we have the efforts of Steve Mnuchin, a completely corrupt moron (married to a modern Marie Anoinette) whohas no idea why the market goes up and down even though he worked for Goldman Sachs and some sort of hedge fund for many years. He called a stock market press conference in the format of a pep rally. It achieved nothing – the market kept tanking. It wasn’t a terrible idea.  So what if it didn’t work?

We need to pick our battles so that when we make a case that the Trump White House is truly corrupt or malevolent people will accept the reasonableness of our position. Leave Mnuchin alone and stop hugging Mattis. (He was never on our team.) Trump has set himself up as the guy who destroyed all of Obama’s work. We don’t want to be defined as the party that exists solely to undo all of Trump’s.

 

Bringing Military Discipline to the White House

I do see the point going in –  a military man is sincere but disciplined. He has great knowledge but perfect discretion. He’ll wait politely for you to finish your thought and will always put his ideas after yours. If he sees any signs of disloyalty he will act with great furor. He will set the perfect example.

Unless…

  • He has reached the level where he believes his orders must be followed to the letter.
  • He looks down upon other employees because they lack his experience – no matter if it is completely unrelated to the task at hand.
  • He thinks the Commander in Chief fails to set a proper military style example and so is undeserving of his loyalty and obedience.
  • He has become completely fixed in his views of how certain problems should be solved.

The Prussians had so many wins in the 19th century that they started to buy into the notion that rule by military government was the best political solution. Then the Japanese bought in for the same reasons. We had a crippled President who would never believe in or successfully sell such an approach to managing his own government, even during a war. (LBJ learned nothing from this.) The chaos worked beautifully.

Our democratic system depends on open debate with some unsolved issues. It’s perfectly OK if some cabinet members are on different sides of an issue as long as they don’t spend their time undermining each other in public. Can you think of a public policy issue that has only one (reasonable) side? Trump has tried to run a purified cult with a unified view on every issue – that is impossible, so imposing it from above by choosing generals as ruling members brings anger and indiscipline.

These are battles without guns that Kelly had no idea how to win.

The election is over and here they come!

Okay – the election is over and the Dems get the House back so they are ready to rumble. What’s on their top 10 list? – Why, illegal immigration of course. I’m sure Nancy is dying to cry foul. She’d like to put all these caravan people up at the Trump hotel. Does Nancy have a fully developed policy in hand?

  • We don’t know how to process all these Hondurans.
  •  We don’t know how to separate immigrants from asylum seekers.
  •  We have never shown the capacity to deport them back to their country of origin. Once done – how do we keep them there?
  • Are we to blame for their economic morass?
  •  What do we do with children?

The  problem goes much deeper than the logistics of handling new immigrants. As general Mattis sends in some troops we need to think how badly Bill Clinton screwed this up. Back in the 90’s Central (and South) Americans were set up by US trade agreements to produce and sell us textiles.  Then Clinton decided to give away special trade status to every Asian country.  Most developing world trade aid is just a form of welfare since we know they’ll never buy anything we make – they’re too poor) so this was his idea of being charitable.

  • In 1997 Central American production (Mexico, Honduras, Guatemala, and El Salvador) produced 19%% of our needs.  Asia (China, Vietnam and Bangladesh) also produced 19%.
  • In 2001 it was 22 to 17 (so far so good).
  • In 2006 it was 14 to 29
  • In 2107 it is 12 to 54%!

Quite simply we have allowed Asia to destroy countries that have far more political significance to us. Without work, their economies and societies melt down and their desperate people come here.  Who we trade with should be a strategic political decision.  We must be particular about who we buy our stuff from so we get the most bang for our buck.

All this reminds me of the Arab Spring where an ocean of overeducated Egyptians and Algerians wondered about with nothing to do but apply to graduate school and for government jobs. Choice #2 for these young people was ISIS. What are all those  20 somethings doing in Italy, Spain, and Greece  – same problem. China has all the capacity in the world to replace every laborer on the planet – at a lower cost. Even subSaharn Africans didn’t expect this.

“Free” traders have set policy that essentially forces us to take in Mexican and Central Americans as immigrants whose jobs “we” shipped to China/Asia. Mexico would be doing the same thing if it weren’t for cars and the corruption of NAFTA.

This is just another example of what happens when people use trade policy like they’re Santa with no consideration of immigration and factor price equalization.

Robert Reich should be the man that Trump sends to confront these desperate people.

Do bombs and death mean more bombs and death?

We sometimes feel like the failure of new terrorists or even their success are so stunningly evil that it will deter other nuts and copycats since they must watch all the negative media coverage. Wouldn’t they presume that they too would be pilloried for any such similar act? All those thoughts and prayers verses a smattering of applause from inside the alt-right and neo-Nazi websites.

Malcolm Gladwell espouses what is called a diffusion index of terrorism. It says the opposite. The more people who do this, the greater the nerve of those others who have thought about it. Maybe they think they can do it better or they actually want to be like that guy who they just saw on TV.  Either way, more attacks are bad without exception.

What if Trump and his band of Soros haters realized how weaponized their words are. Does Lou Dobbs have it in him to recant or recognize the link made between Anti-Semites and George Soros, Tom Steyer and Michael Bloomberg? Does Trump have the will or weight to pull all this rhetoric in the opposite direction – no chance. If he did, the wackos would probably just wink back. (Besides Dobbs wants the ratings!)

I don’t think Gladwell expected the terrorist theme to switch to domestic political villainy and its appropriate punishment. Teenage, incel angst has far fewer sympathizers (I presume). The significant expansion of new sample cases in just one week should leave Gladwell and the rest of us very discomfited. All the negative imagery of bombs and arraignments are food for other Lou Dobbs fans. The genie has been let out and suddenly advocating tough measures” against Jews and political enemies looks a lot more like “inciting to violence”- something we should be prosecuting, even if it does seem too late to Malcolm.

What is the perfect amount?

Do you ever get the impression that we have gone as far as we can go in many respects?

  • We have overproduced digital phone apps.
  • We have too many ways to make a (real) phone call and only prisoners seem to make them.
  • We have too many poverty-stricken people in the world with no economic purpose.
  • We have too many academics and too many academic bureaucrats.
  • We have overproduced music so much that the most popular kinds have no melody.
  • We have so much (video) entertainment on our phones that there is no time to read and reflect. (Do people read books on subjects other than food?)
  • There seem to be a ton of people headed off to do jobs that aren’t that necessary? (like SEO managers) Aren’t there way too many car and truck drivers?
  • Didn’t social media advertising become saturated about 5 years ago? Do we really need to spend more $ on Google ads? What is the ROI?

It seems like years ago we really needed more reliable cars and better-sounding stereos – right away. We needed cheaper clothes, more reliable cars with better gas mileage, and more media options. We needed more than (plain) penicillin. We needed to get to the moon! (Do we really need to get to Mars?)

When we asked for new stuff, it usually came below par – we could see obvious areas for improvement. That meant more work for designers and manufacturers. Apple seems to have no clue how to make their phones better – and neither do I. If someone asked me for a features wish list in Excel in 1998 I’d have some ideas. I don’t know what would be on the list now.

Am I saturated in the world of consumer goods? Apparently – I never go into Best Buy … do I need a bigger TV?  My laptop is 3 years old and if I replaced it, the new one would look just like it. Do you enviously study the latest iPhone features? My Christmas list consists of replacement clothing items.

It’s not just that I’m old, though that’s a big part of it. My 20-year old children have terrible wish lists too. It leaves them saving for housing, transport, food, and vacation – the normal big four from history. (Borrrring)

Wasn’t it so much more exciting when there were other new things coming up all the time that seemed both necessary, and stimulating? We needed to get those people on the subway to work – there was a lot to be done.

Not anymore.

Does choreography matter?

I always guessed that our version of a new Republican authoritarian would be a Colin Powell type – plenty of medals, perfect posture, and low volume. Military people are usually sheltered by handlers so we wouldn’t hear a lot of (bad) history about stupid/uninformed comments.

I should have seen my mistake. We got a legitimate corporate contender in the 90’s. Instead of a smooth, buttoned up Jamie Diamond we got a paranoid dwarf -Ross Perot. Independent candidates are a varied lot. They often come unpackaged.

So now it’s come to this:

The backdrops are no longer long escalators (plus trophy wife). They are nodding pre-programmed idol worshipers, looking for camera exposure.

My sense is that his failure to choreograph the message is already a drag on the enthusiasm of the true believers. Just as with Bush Jr. they continued to side with their guy but their conviction faded. Trump needed tangible results in a few simple areas (for his simple followers) – there’s no wall, no Muslim ban, no change to NAFTA, no jobs coming back from China. Political corruption in his administration is worse than we’ve ever seen. He needs style to offset all these failures. (Does his Saudi defense help him in the heartland?)

He does best with a target- an adversary. The Dems would do best to hide in the trenches. (sorry Elizabeth) Without one he is adrift and so needs to go back to style. This, he has failed to do. Is there is too much baggage to be manageable?

The racists will be there, but the (economically) disenfranchised  and the authoritarians will sit it out. If the Repubs lose the House then the malaise will continue into 2020 and he could be really challenged  to get the nomination again. Toilet paper (moments) may have written the next act of the play.

Trump needed Hillary – without her he is flailing.

Weekend Musings

  • Please stop comparing historical “creative destruction” with our current problems. I can retrain a horse and buggy driver to be a cab driver (circa 1910) in about a day. I can’t teach a sales clerk at Macy’s how to write Python code.
  • Israel’s plan of loving all thing’s Sunni and hating all things Shiite is and always was a self-serving policy that will fail spectacularly. The enemy of my enemy is not necessarily my friend. Didn’t we all finally learn this during the 2nd Gulf war? How about this? – The fiend of my friend (Israel) isn’t necessarily my friend.
  • No, China has no idea how to transition from a small TIGER like , export-driven, economy to a fully diversified first world economic state. We fed it a few import tariffs and the wheels are almost coming off the entire corrupt state. It’s a dirt cheap offshore polluting, parasite fed by our purchases. Let us never forget that.
  • Renaming NAFTA is not an achievement. Neither is your assertion that you saved pre-existing exemptions for new buyers of health insurance –  because you failed to get it passed.
  • So far our giant corporate tax cut has given us exactly what we expected – soaring budget deficits, giant stock buybacks, no wage gains, no acceleration in hiring or training. Even the Repubs are too embarrassed to bring it up.
  • The stock market has been fed by two energy sources over the past twenty years:
    1. Low-interest rates
    2. Outsourcing and automation that raises the ROR on labor … They are both going away (for now) but we have fabulous stock buybacks to help transition us into a rather dull sideways or down market. No reason for panic if you’re long but no reason for optimism either.

The Patriot Tax

How will people handle a 10% increase on all Chinese goods (initially just $200 bn of them)? Will they run screaming from Walmart crying for armed rebellion? … or maybe they won’t notice that a shirt at TJ Max went up from $13.50 to $14.75?

Catherine Rampell (WashPo Oped writer) thinks this is a travesty as though we (Trump et al) have sinned against the one true American creed – consumerism. Why is it so hard to accept the idea that paying a higher price for some things can be in the national interest? It makes sense to have tariffs against trade criminals and to protect jobs even if it’s at the expense of the consumer.

My guess is that this 10% price increase will be a giant non-event. Economists may whine but people won’t get too exercised. The question is -will this experiment in domestic preference sustain itself through the next administration. It seems clear to me that since Trump raised the issue of Chinese trade crime many non-Trumpsters have recognized the validity of the case. Now they must deal with one of the appropriate ways to counteract it. If you’re against their subsidization of exports and IP theft then what would you recommend? You no longer get to whine about the inefficiency of tariffs without proposing an alternative.

We could set up a rebate for the poor or increase food stamps. We could/should exclude non-essential consumer items that will never be made in the US no matter how much of a tariff we apply – Haloween masks and cheap plastic toys. I’m after things like LCD screens for airplanes and antibiotics. I’d like to know that such things were procurable in the US in case our giant parasite gets testy.

In the long run, production adjustments will happen; prices will do their job but if the market thinks this is just a temporary Trump-only policy then nothing will be achieved. It’s true – a rollback will come along with a smug proclamation of how tariffs never work but If the reaction to the tariffs is diminimus then it makes it easier to leave them intact. It would also help if the tariffs came with a guarantee that the revenue was used to pay down the national debt and increase food stamps.

Then retracting them would be almost impossible.

Fair and Unbalanced

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